CMA CGM / DELMAS

BENIN’S STRATEGIC CASHEW EXPORT PARTNER

Full Story On Page 4

• Benin: Price Of Cashew Fixes To FCFA 225kg• Gambia: Deadline Extended For Groundnut Trade Season• Ghana: Minimum Price For Raw Cashew Nuts Announced• Nigeria: NCAN Signs US$5 Million Deal To Export Cashew

AFRICACOM-WATCH

SADC Must Embrace Bt Cotton

ISSUE 47 | APRIL 2015

Fish Initiative May Salvage Sector’s U.S.$5 Billion Loss

South Africa: Campaign To Raise Bottled Wine Exports

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Fish Initiative May Salvage Sector’s U.S.$5 Billion Yearly Loss

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CMA CGM / DELMAS: Benin’s Strategic Cashew Export Partner

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South Africa: Campaign To Raise Bottled Wine Exports

Southern African Development Community Must Embrace Bt Cotton

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AFRICACOM-WATCH

ISSUE 47 | APRIL 2015

Contents03 / General

04 / Cashew, Groundnut & Shea

06 / Cassava

07 / Cocoa

11 / Coffee

13 / Cotton, Textiles & Leather Goods

15 / Fish

16 / Foodstuffs & Beverages

21 / Palm Oil

22 / Sugar

24 / Tea

25 / Timber

28 / Tobacco

Top Stories

News Headlines By RegionWestern Africa

Benin: Benin Fixes Price Of Cashew To FCFA 225kgBurkina Faso: SOFITEX Gets New BossCameroon: Cameroon To Increase Cocoa Processing Output / Cameroon Mid-March Farmgate Cocoa Prices Rise / Backlog At Cameroon’s Main Port Slows Cocoa Exports / Cameroonian Coffee Festival: Festicoffee 2015 / Sodecoton To Produce 16,000 Tons Of Soybean / Moroccan Cosumar To Promote Batouri Sugar Project / Higher Canadian Sapelli Imports From CameroonCote d’Ivoire: Ivory Coast To Overtake Netherlands As Top Cocoa Processor / CEMOI To Open Factory In May / Ivory Coast Weather To Help Cocoa Mid-Crop -Farmers / Drop In Cocoa Bean Size Worries Ivorian Exporters / Cote d’Ivoire Must Avoid Over-Production Of CocoaGambia: Gambia Extends Deadline For Groundnut Trade SeasonGhana: Ghana To Curb Shea Exports In Move To Control Beauty Product / Minimum Price For Raw Cashew Nuts Announced / Ghana May Access Gluten Free Market In Asia / Government To Attract Young Into Cocoa Farming / Surge In Air Dry Sawnwood Exports As Power Outages Limit Kilning / New Bamboo Craft Village / Organisation Calls For Review Of Ghana Rosewood BanGuinea: World Bank Allocates US$22 Million To Guinea & Mauritania FisheriesLiberia: NCSCC Launches Program On Cassava ValueMali: Mali Government Initiates Aquaculture ProjectNigeria: Olam Nigeria Finances 12,000 Farmers With N536m / NCAN Signs US$5 Million Deal To Export Cashew / Pioneer Foods Enters Nigeria Market With US$7 Million Investment / Nestle Nigeria Slows ExpenditureSenegal: Groundnut Production Rises Sharply / EU Funds Onion Storage Facilities In Senegal

Eastern Africa

Burundi: Revenues Rise 2.4% In 2014Ethiopia: Coffee Exports Are Exceeding Planned Revenue Targets / Dutch Brewer’s Ethiopia Unit to Start SalesKenya: Keroche Breweries Eyes 20% Market Share / Kenya Wins COMESA Extension For Sugar Imports / Kenya Allows More Sugar From Uganda / Kenya To Sack Over 300 Workers To Save Sinking Sugar Company / Prices Drop As Production Increases / Kenya Tea Factories Scale Down Operations as Drought Cuts Yields / Higher Export Earnings Boost BAT’s Net ProfitMalawi: Relations With Brazil Could Spark Production BoomMozambique: Brazil Plans To Install Cotton Research Centres In Mozambique / Mozambique Expands Banana Production Areas In Nampula ProvinceRwanda: Rwf3 Billion Coffee Factory Opens In GikondoTanzania: Scientists Set To Create Banana Hybrids To Raise Yields / Treasury, Sugar Producers In Cautious Import DriveUganda: February Coffee Exports Down 30% / March Coffee Exports To Fall On Dry Weather / Uganda Coffee Sector At Crossroads / Ugandan Coffee Gets International Support

Southern Africa

Regional: SADC Must Embrace Bt CottonSouth Africa: Campaign To Raise Bottled Wine Exports / Progress In South Africa-US Meat DisputeZambia: Zambia To Sell Corn To Regional Neighbours / ZAFFICO Cuts Log VolumesZimbabwe: Farmers Ask Regulator To Reinstate Price Setting / Tobacco Farmers Rake In U.S $1,2 Million / Irregular Tobacco Season Forces TSL to Innovate / Virginia Tobacco Exports Rake In Over U.S$200 Million

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Website: www.delmas.comEmail: lhv.marketing@delmas.netTweet: @DelmasWeDeliver

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Tel : +33 (0)4 88 91 90 00

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and timely information in this report. No responsibility is accepted for

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the information. Accordingly Delmas denies any liability for any direct,

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or actions undertaken on the basis of, such data and information are the

sole responsibility of the reader.

THE AFRICAN COMMODITY REPORTBrought to you by CMA CGM / DELMAS Marketing

Rachel Bennett Dominic Rawle

NigeriaOlam Nigeria Finances 12,000 Farmers With N536mOlam Nigeria has provided N536 million as financing for 12,000 Nigerian cocoa, cashew and sesame farmers in 2014 under the Olam Livelihood Charter [OLC]. The leading agri-business company in Nigeria makes the financing available to farmers as short-term micro-financing, advances for crop purchases and mid-term loans for the procurement of farming inputs. The OLC charter sets stringent standards for supporting smallholder communities through 8-principles: financial support, improved yields, better labour practices, market access, improved crop quality, traceability, social investment and minimising environmental impact. Only by meeting all eight can a sustainability programme be awarded OLC status.

Three of Olam International’s 30 flagship OLC initiatives are in Nigeria, where Olam works with cashew, cocoa and sesame smallholder farmers. Highlights from 2014 OLC initiatives in Nigeria include working with 12,000 farmers in Osun, Ondo and Cross River for cocoa. Kwara and Oyo farmers were assisted for the production of cashew while Jigawa, Bauchi, Nasarawa and Benue farmers were supported for sesame.

In addition to the OLC programmes, Olam Nigeria has launched an outgrower programme around its rice farm in Nasarawa State, in collaboration with USAID and the National Agricultural Development Programme. Rice farmers are also supported with training and high-quality seeds from Olam’s farm in order to improve their paddy yields. The paddy is then purchased by Olam at a fair market price and sold locally. Currently 3,000 farmers are engaged in the programme, with a target of 16,000 by 2018.

[This Day 12/03/15]

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COMMODITY NEWSGENERAL

BeninBenin Fixes Price Of Cashew To FCFA 225kgThe Benin government will increase the price of cashew to FCFA 225kg for 2014-2015 up from FCFA 200kg in 2013-2014. According to the Ministry of Trade, Industry and SMEs this reflects the growing importance of cashew in agriculture in Benin. A study by the Chamber of Commerce and Industry showed that raw cashew nut exports to the international market, especially to China, Indonesia, Vietnam and the European Union have increased in recent years. Cashew areas under cultivation have also expanded and the country expects to produce about 120,000 tons of raw cashew during the 2014-2015 period.

[MedAfricaTimes 10/03/15]

GambiaGambia Extends Deadline For Groundnut Trade SeasonThe Gambia Groundnut Corporation [GGC] has announced that it has extended the deadline for this year’s groundnut trade season from 15th March to 31st March due to ‘high demand’ by farmers. The national company has urged all farmers to sell their groundnut produce to the government before the dateline elapses. Gambian rural farmers recently complained a lack of cash at some groundnut buying centres, locally known as “Seccos”, which has disrupted the trade.

[APA 11/03/15]

CMA CGM / DELMAS: Benin’s Strategic Export Partner

During a customer reception for the launch of the cashew nut campaign hosted by Eric Neute [General Manager Delmas Benin] and Coralie Thuillier [Line Manager Asia - West Africa & East Coast South America - West Africa], the CMA CGM Group reaffirmed its commitment to Benin’s cashew industry with a range of all-inclusive land and sea services with the support of a network of offices around the world.

For more information on our export services http://www.delmas.com/products-services/our-services/african

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COMMODITY NEWSCASHEW, GROUNDNUT & SHEA

GhanaGhana To Curb Shea Exports In Move To Control Beauty ProductGhana plans to block shea exports by companies not registered with the government. Shippers have been told that they must sign on with the Ghana Cocoa Board by the end of March or face a ban.

The Ghana Cocoa Board is stepping into the industry to promote prices. Demand is growing in Europe, North America and Asia as companies such as L’Oreal SA’s The Body Shop sell lotions and soaps made from the commodity, while Wilmar International Ltd. processes it for food flavouring. Ghana is currently the world’s third-biggest producer of shea nuts; output reached 73,500 MT in 2012. Nigeria and Mali are the largest producers.

A project funded by the state-owned Export Trade, Agricultural and Industrial Development Fund to cultivate shea trees will start this year. The fund is providing US$960,000 for 1 million trees over 2-years. At least 2.2 ha in each of Ghana’s 3-northern regions will be cultivated with seedlings. The farms will take 5-6 years to start producing nuts, compared with 20-25 years for trees grown in the wild. Ghana plans to set up an independent shea board by 2023. It will regulate the industry, including setting pricing and rules for marketing.

[Bloomberg 11/03/15]

Minimum Price For Raw Cashew Nuts AnnouncedRepresentatives of the Ghana Cashew Industry Stakeholders have agreed on GH¢2.70/kg as the starting price for Raw Cashew Nuts in the 2015 cashew season. This is the first time industry players have joined to set a common price for the beans. In 2014 the Ghana Cashew Industry Stakeholders called for a committee to set prices for the sector with the Ministry of Food and Agriculture as the facilitator. The committee comprises of farmers/producers, processors, traders/buyers and exporters who determine a price that will be beneficial to all stakeholders and allow processors to compete for raw cashew nuts.

[Graphic Online 18/03/15]

NigeriaNCAN Signs US$5 Million Deal To Export Cashew The National Cashew Association of Nigeria [NCAN] has signed a US$5 million [N1 billion] with shipping companies in Nigeria to export cashew nuts. The deal was sealed at a meeting with cashew exporters, shipping companies and forwarding agents. Exporters will export 6,700 containers of cashew nuts to Vietnam, India and other Asian countries this year. NCAN insist on global best practice for cashew handling and will work closely with the shipping companies.

[Observer 26/02/15]

SenegalGroundnut Production Rises SharplyGroundnut production in Senegal rose by 38.6% between 2013 and 2014, according to the Dakar-based Directorate of Forecasting and Economic Studies [DPEE]. Production witnessed a rise from 58,000 to 80,400 tons during the period under review. The upward trend was boosted by oil cake which increased by 76.4% or 40,700 tons and crude oil, which shot up by 72.2% or 32,900 tons. The production of refined oil dropped from 56.7% in 2014 to stand at US$6,900 tons more than the 15,800 tons registered in 2013.

[APA 27/02/15]

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COMMODITY NEWSCASHEW, GROUNDNUT & SHEA

GhanaGhana May Access Gluten Free Market In AsiaAccording to the GRATITUDE project, Ghana may soon be able to access the gluten-free market in Asia, estimated to be worth half a billion dollars, to sell its cassava flour. Cassava flour, which is gluten free, is emerging as a food substitute in Asia’s growing gluten-free market. The GRATITUDE project is funded and undertaken by research institutions in the European Union [EU]. The objective of the project is to improve the post-harvest management of cassava and yam, leading to reduced physical losses and economic losses through value-added processing through the utilization of wastes [peels, liquid waste, spent brewery waste] to produce other products.

[Ghanaweb 08/03/15]

LiberiaNCSCC Launches Program On Cassava ValueThe National Cassava Sector Coordinating Committee of Liberia [NCSCC] has embarked media promotion to encourage cassava consumption as well as increase its market value. The NCSCC is implementing this as part of a European Union [EU] funded project. The promotion aims to showcase the different cassava value added products. The NCSCC’s is also working with the sector to introduce new methods of planting to increase yields. Farmers produce an average 25-30 tons of cassava per hector, up from 5-10 tons.

[The Inquirer 17/03/15]

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COMMODITY NEWSCASSAVA

GeneralIvory Coast To Overtake Netherlands As Top Cocoa ProcessorIvory Coast will this season overtake the Netherlands as the world’s top cocoa processing nation.

According to the International Cocoa Organization [ICCO], issuing its first estimates for 2014-15, forecast declines in both world production and consumption. However, output will fall further to 17,000 tonnes behind consumption, returning the sector to a production deficit after a small surplus, of 30,000 tonnes, last season. The relatively small drop in demand reflects ideas of growth in Africa, and in particularly in Ivory Coast which will become the top processing nation.

Ivory Coast cocoa grindings in 2014-15, which began in October, will climb by 4% to 540,000 tonnes, reflecting the continuous tendency to expand processing capacity. The country has encouraged cocoa grinding in-country, to add value to its production, while for processors crushing beans at origin saves on transport costs and can offer wage savings, prompting the likes of Olam to open plants in Ivory Coast.

For the Netherlands grindings will drop 1% to 529,000 tonnes this season. Europe will remain the top processing region, at 1.57m tonnes, down 1% year on year, ahead of the Americas at 903,000 tonnes, with African grindings seen growing by nearly 2% to 877,000 tonnes.

The forecast for a drop in world production, seen falling by 123,000 tonnes to 4.23m tonnes, reflects expectations of damage from drier-than-average weather patterns in West Africa, which is responsible for 66% of global output.

The seasonal Harmattan winds were more severe than expected, while the dry hot weather conditions currently prevailing have been raising concerns for the mid-crop in the region. Ivory Coast output was seen falling by 26,000 tonnes this season to 1.72m tonnes, while Ghana output was pegged at 810,000 tonnes, a drop of 87,000 tonnes.

[Agrimoney 27/02/15]

Olam Predicts A Global Cocoa Deficit In 2015

According to forecasts by Olam, the world cocoa market will be in deficit this year after the fall recorded by the Ghanaian production. Ghana and Ivory Coast, the world’s two largest producers of the commodity, were affected by persistent Harmattan which had an adverse effect on the crop.

[MedAfricaTimes 12/03/15]

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COMMODITY NEWSCOCOA

CameroonCameroon To Increase Cocoa Processing Output Cameroon plans to double its cocoa processing capacity to 30% of its total production, or 70,000 tonnes of beans per year, by adding 10 new processing units. Cameroon produced 209,905 tonnes of beans in the 2013-14 season but only about 32,700 tonnes were processed locally. The project is expected to cost about US$5.23 million. Cameroon aims to increase revenues by processing beans locally into cocoa butter and cocoa powder. The government has not said when the plants would start production, but the units should have the capacity to process 15 tonnes of cocoa per day and 36,000 tonnes per year, producing 9,000 tonnes of butter and 25,000 tonnes of cocoa powder for the local market and for exports.

[Reuters 16/03/15]

Cameroon Mid-March Farmgate Cocoa Prices RiseCocoa farmgate prices in Cameroon rose by mid-March as crop quantities declined at the end of the main harvest. A kilo of cocoa beans is being sold in Bafia [Centre Region] at 1,450 CFA francs, up from 1,375 CFA francs a month ago.

[Reuters 16/03/15]

Backlog At Cameroon’s Main Port Slows Cocoa ExportsCocoa exports from Douala have slowed sharply due to a build-up of imported goods bound for Central African Republic [CAR] which have not been forwarded due to political unrest. Douala is the main gateway for goods into and out of the oil, cocoa and timber producing Central African nations. The problem at Douala has cost the cocoa industry of around US$653,595 in revenue this year.

Workers and exporters at Douala who are trying to clear their goods said the port is so full of containers it can take 90 days to clear shipments. Prime Minister Philémon Yang ordered the establishment of a priority corridor for cocoa at the port and this year more than 50,000 tonnes of cocoa have been exported. A newly-built port and container terminal in Kribi, about 200km further south, that was meant to decongest Douala port and improve shipping services is not yet operational.

[Reuters 16/03/15]

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Cote d’IvoireCEMOI To Open Factory In MayFrench chocolate maker CEMOI plans to open a factory in Ivory Coast in May to target the local and West African market. Ivory Coast is the world’s top cocoa grower and the second-largest grinding hub behind the Netherlands, but very little shop-ready chocolate is made in the African country and locals mostly eat expensive imported chocolate. CEMOI buys about 145,000 MT of cocoa beans every year and already produces semi-finished chocolate products.

[Reuters 02/03/15]

Ivory Coast Weather To Help Cocoa Mid-Crop -FarmersAbundant rainfall in most of Ivory Coast’s main cocoa growing regions is a positive sign for the April-to-September mid-crop but there is concern over the quality of the bean crops in some regions. Rains in the southern region of Aboisso improved soil moisture content which helps pod growth. In the southern region of Divo, farmers said the weather was so favourable some mid-crop pods were already ready for harvest. No rain was reported in the western region of Soubre, at the heart of the cocoa belt. A different picture emerged in the centre-western region of Daloa, which produces 25% of Ivory Coast’s output. There farmers reported just one heavy shower. Farmers reported similar growing conditions in the western region of Bouafle.

[Reuters 17/03/15]

Drop In Cocoa Bean Size Worries Ivorian ExportersDry weather has caused a sharp drop in bean size and will delay the start of the April-to-September mid-crop by nearly 2-months. Bean size is determined by counting the number of beans per 100 grams of cocoa, known as the bean count. Ivory Coast’s marketing board, the Coffee and Cocoa Council [CCC], has fixed a ceiling of 105 beans/100g for beans destined for export.

Average bean counts have increased from 100-105 beans/100g to 120 to 130 beans/100g over the past several weeks. Bean size generally decreases during the mid-crop and the bulk of the harvest is typically purchased by local grinders who process them into cocoa products. Excessive acidity in cocoa beans arriving at the ports of Abidjan and San Pedro have already led to high rates of rejections beginning in late January. Merchants said small bean size was adding to the amount of cocoa being turned away from ports.

Ivory Coast is in its mid-November to March dry season, which this year has been marked by very little rainfall, high temperatures and unusually harsh Harmattan desert winds. Exporters are predicting a smaller mid-crop than the one that contributed to last season’s record crop. The International Cocoa Organisation is forecasting Ivory Coast’s total 2014-15 production to reach 1.72 million tonnes, down from 1.74 million tonnes last season.

[Reuters 08/03/15]

Cote d’Ivoire Must Avoid Over-Production Of CocoaThe International Cocoa Organization’s [ICCO] has said Ivory Coast must avoid over-production. ICCO is forecasting the second largest harvest on record this season with a crop of 1.72 million tonnes. It is not out of the question that this production could reach up to 2 million tonnes. Over-production risks causing a drop in world prices after output hit a record 1.74 million tonnes last season. In the decade before the 2013-14 season, Ivory Coast recorded average annual production of around 1.4 million tonnes.

[The Africa Report 06/03/15]

GhanaGovernment To Attract Young Into Cocoa FarmingGhana is introducing an incentive package to support young people who want to enter into cocoa farming in the country. The programme hopes to attract more young people into cocoa farming to replace aging cocoa farmers, many of whom cannot sustain the future of the cocoa industry in the country.

[Business Ghana 13/03/15]

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COMMODITY NEWSCOCOA

Daily Spot Price [ICCO]These are the average of the quotations of the nearest three active futures trading months on NYSE Liffe Futures and Options and ICE Futures US at the time of London close.

Date ICCO daily price (SDRs/tonne)

ICCO daily price (US$/tonne)

London futures (£ sterling/tonne)

New York futures (US$/tonne)

2 Mar 15 2162.61 3042.38 2015.67 2990.00

3 Mar 15 2181.46 3061.70 2021.33 3016.00

4 Mar 15 2163.92 3034.14 2023.67 2983.00

5 Mar 15 2166.94 3027.89 2025.33 2974.33

6 Mar 15 2136.68 2974.18 2011.67 2921.00

9 Mar 15 2140.79 2969.34 2001.00 2918.67

10 Mar 15 2135.96 2948.93 1990.33 2896.33

11 Mar 15 2099.68 2887.44 1969.33 2834.67

12 Mar 15 2096.60 2885.70 1977.33 2831.00

13 Mar 15 2091.95 2867.88 1983.33 2815.00

16 Mar 15 2077.09 2843.96 1959.67 2783.00

17 Mar 15 2067.63 2837.86 1964.33 2783.33

18 Mar 15 2046.39 2804.98 1947.33 2747.00

19 Mar 15 2009.66 2769.67 1924.67 2706.33

20 Mar 15 2061.03 2838.43 1943.00 2771.00

23 Mar 15 2027.78 2813.30 1923.67 2755.33

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CameroonCameroonian Coffee Festival: Festicoffee 2015The 2015 international festival of Cameroonian coffee [Festicoffee] is to take place from 23-25 April 2015. The event is organized by the Interprofessional Council of Cocoa and Coffee [CICC] and the Ministry of Trade and which will see tastings take place simultaneously in 23 cities throughout the country.

[Ecofin 18/03/15]

EthiopiaCoffee Exports Are Exceeding Planned Revenue TargetsEthiopia’s coffee export revenue for H1 2014-2015 has exceeded planned targets. The target for the first 6- months of the budget year was US$269 million from the export of around 73,590 tonnes of coffee, but exports amounted to 73,227 tonnes with a revenue of US$307.5 million. The Ministry of Trade said this was a result of high international coffee prices. This fiscal year Ethiopia expects to produce a total 461,620 tonnes of coffee, of which it expects to export 239,950 tonnes and earn US$862.55 million. This would be an increase of around 23.6% in volume and 20% in revenue over the previous year. Ethiopia is fifth in the world in the production of coffee.

[11/03/15]

RwandaRwf3 Billion Coffee Factory Opens In GikondoRwandan coffee farmers can expect a boost in incomes following the inauguration of a coffee roasting and packaging factory in Gikondo, Kigali. The factory is owned by the Rwanda Farmers Coffee Company [RFCC] whose shareholders include the Clinton Hunter Development Initiative, Development Bank of Rwanda, The Hunter Foundation and the National Agricultural Export Board. The US$3 million facility has a production capacity of 3-tonnes of roasted coffee per day. Rwanda earns US$60 million from coffee exports annually and targets to earn between US$100 and US$150 million.

[New Times 09/03/15]

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COMMODITY NEWSCOFFEE

UgandaFebruary Coffee Exports Down 30%Uganda has seen its coffee exports falling 30% to 290,475 60-kg bags in February compared with the same month in 2014, due to dry weather in major harvesting areas. The state-run Uganda Coffee Development Authority [UCDA] noted exports of 310,829 60-kg bags of in January, down from 391,514 bags in the same month in 2014.

[Reuters 25/02/15]

March Coffee Exports To Fall On Dry WeatherUganda said it coffee shipments in March could drop to about 260,000 60-Kg bags compared with 348,423 bags exported in the same month last year, depressed by low international prices. Uganda Coffee Development Authority [UCDA] said shipments of the beans in February reached 290,475 bags, an 18% decline from volumes shipped in the same period last year, after harsh weather depressed yields. Dry weather has already forced Uganda to lower its coffee export forecast for the 2014-2015 [Oct-Sept] season by 8.6%. Uganda now expects to ship 3.2 million bags of coffee, down from an earlier projection of 3.5 million bags.

[Reuters 20/03/15]

Uganda Coffee Sector At CrossroadsThe Uganda Coffee Development Authority [UCDA] notes unstable prices on the world market are discouraging coffee farmers from planting more trees and ignoring some of the good agricultural practices that ensure better quality. The price of coffee on the global market has fallen from US$2.4/kg last year to US$2.21/kg due to the large amounts of coffee that are currently on the market.

According to the UCDA total production in financial year 2013-2014 reduced by 7.86%. On an annual basis, exports for 2014 totalled 3.44 million bags worth US$409 million compared to 3.67 million bags worth US$424 million in 2013. This is attributed to the low coffee prices at both global and farm gate prices and also the poor farming methods used which are limiting them in both quality and quantity. Old trees coupled with poorly managed and leached soils have led to very low yields per unit area and lower quality.

Uganda mainly ships beans to the European Union, United States of America, Sudan, Switzerland, India, Singapore and Russia. Robusta accounts for at least 70% of the country’s beans.

The global total production estimate for coffee in 2013-14 has been revised upwards to 146.8 million bags while production for 2014-15 is provisionally estimated at around 141.4 million bags, a projected decrease of 3.6% from 2013-14.

Another challenge is persistent coffee diseases; since 1993 the coffee industry has been attacked by the coffee wilt disease [CWD]. It is estimated that 50% [150 million trees] of the overall Robusta coffee tree population has been infected by the disease and died. Although the government has put in efforts to fight cash crop diseases, CDWs’ remain a very big problem.

[Business Week 08/03/15]

Ugandan Coffee Gets International SupportEfforts to implement a National Coffee Policy have been improved as the United States Agency for International Development [USAID] earmarked US$480,000 towards promoting governance of Uganda’s coffee sector. The National Coffee Policy is expected to rejuvenate Uganda’s coffee sector. Launched in 2013 by government after extensive consultations with various stakeholders, the National Coffee Policy outlines major interventions and formulates a national coffee standard.

[New Vision 10/03/15]

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SADCSADC Must Embrace Bt CottonCotton farming is a source of livelihood to the majority of farmers in drier parts of Southern Africa, but with production of the crop hanging in the balance due to low producer prices and low yields per hectare, cotton growers need to embrace modern farming techniques to compete on the international stage. The 2014 report, released by Index Mundi [IM], a global commodity brokerage portal, ranked mostly Asian, European and American countries as top cotton producing nations. According to IM, India with an output of 13 956 696 MT of lint [processed cotton] is the largest producer followed by China, the United States, Pakistan and Brazil.

Burkina Faso, one of the first African countries to allow production of genetically modified cotton - also known as Bacillus thuriengensis [Bt] - is the continent’s top producer and sits at number 10 on the world rankings with an output of 585,280 MT last year. Bt cotton is a genetically modified variety which has the gene for producing the Bt toxin. This toxin prevents insects in the larvae stage from successfully digesting food, thus starving the insect and making plants resistant to pests.

Tanzania is the #1 cotton grower in the Southern Africa Development Community [SADC] and #21 globally with production of 266,400 MT of lint followed by Zimbabwe #2 in SADC and #27 in the world. According to the report, Zimbabwe produced 112 554 MT of lint last year. Zambia, Mozambique, Malawi, South Africa and the Democratic Republic of Congo followed.

Agricultural experts believe that embracing Bt cotton in East Africa will help to correct the poor quality and low yield currently being experienced by most regional cotton farmers, who yield about 500 kg/ha but could yield 4 to 5 MT. Bt cotton costs less to produce but results in high yields; it matures faster than the conventional cotton and can substantially reduce the number of pesticide sprayings as a result of its pest resistant nature. The adoption of Bt cotton is an increasingly important tool for farmers around the world can benefit large and small scale farmers through increased productivity, convenience, and reduced maturity time.

In the SADC region only Malawi allows Bt cotton to be grown. South Africa has engaged in trials but it is still to embrace new method. Zimbabwe has previously attempted to produce seeds for Bt cotton, but the project failed for take-off. According to the International Cotton Advisory Committee [ICAC], cotton growers in the SADC region are set to endure low producer prices during the 2015 marketing season due to huge stockpiles of the crop from last season currently being held by countries such as China and India. Global cotton hectarage is also expected to plummet 6% next season due to persistently lower prices on the global market. As most SADC nations heavily rely on the international markets, the current low world prices will be certainly felt in the region.

[Southern Times Africa 23/03/15]

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COMMODITY NEWSCOTTON, TEXTILES & LEATHER GOODS

Burkina FasoSOFITEX Gets New BossGnissan Zougouri Bernard, former Secretary General of the Trade Ministry has been appointed new Managing Director of Burkina Faso’s Textile Company [SOFITEX]. He was appointed during the last cabinet meeting replacing Jean-Paul Sawadogo in office since 2011. Bernard served at the Ministry of Industry, Trade and Handicrafts as Secretary General since June 2011. In that capacity, he was also Chairman of SOFITEX Board of Directors.

[Star 28/02/15]

MalawiRelations With Brazil Could Spark Production Boom The Malawi and Brazilian governments have partnered under the cotton development agreement to boost cotton production. The partnership will see modern technologies and cotton breeds developed under Brazilian Research Corporation [Embrapa]. Under this partnership, Malawi cotton exports is expected to drive up production thereby raising export revenues significantly. Mozambique, is also expected to benefit from this project. The project is a replication of one that was implemented by Brazil in Benin, Burkina Faso, Chad and Mali known as Cotton-4.

[Ventures 03/03/15]

MozambiqueBrazil Plans To Install Cotton Research Centres In MozambiqueA team of researchers from Brazil has visited central Mozambique to assess the feasibility of installing 2-experimental cotton research units. The main aim of this project is to transfer Brazilian technology for cultivation of cotton varieties with higher yield which are more resistant to various pests and to promote exports of agricultural equipment. The team currently in Mozambique are part of a regional project to strengthen the cotton sector in the Chire and Zambezi basins.

[Macauhub 17/03/15]

ZimbabweFarmers Ask Regulator To Reinstate Price SettingZimbabwean cotton growers are asking the competition regulator to reconsider its decision removing a price guarantee for their crop. The Harare-based Competition and Tariff Commission recently announced that individual lint farmers must negotiate prices with buyers, removing a government-set minimum price. The cotton price was US$0.63/kg last year when the country produced 143,000 MT of the crop.

In 2012 the government began fixing a price for cotton to protect farmers against declines in the market. Under the rules, buyers were only entitled to recover the cost of investments - fertilizers, seeds and agricultural chemicals given to farmers - if they paid cotton farmers the set price or more. Cotton buyers cut the amount of fertilizers, seeds and agricultural chemicals they last year, which is resulting in lower yields. Companies reduced their support after finding some growers were selling their products outside of contractual agreements. They also faced cash-flow “issues” in the economy that’s struggling to gain traction as consumer spending remains weak.

The cotton-selling season is expected to start in May, where merchants include Cottco Zimbabwe Ltd., and the local unit of Olam International. Zimbabwe vies with Tanzania to be the largest cotton producer in southern and eastern Africa.

[Bloomberg Africa 09/03/15]

14

Pan AfricaFish Initiative May Salvage Sector’s U.S.$5 Billion Yearly LossIf effectively managed and implemented, the new pan-African fish project would strengthen the continent’s potential for increased trade in fish, while addressing the yearly loss of US$5 billion arising from mismanagement in the sector.

The initiative, ‘FishTrade for a Better Future’, a European Commission funded project implemented by WorldFish, the New Partnership for Africa’s Development [NEPAD] and the African Union Inter-African Bureau for Animal Resources [AU-IBAR] will strengthen value chains and, with a focus on sustainability, give better access to intra-regional markets and subsequently improve food and nutritional security and income in sub-Saharan Africa.

According to a report on policy framework and reform strategy for fisheries and aquaculture in Africa, the potential of the sector to contribute to poverty reduction and improved socio-economic benefits to populations have not been optimally exploited, coupled with estimated US$5 billion loss by African countries yearly due to mismanagement in the sector.

The initiative, launched recently, is expected to support adoption and implementation of appropriate policies, fish certification procedures, standards and regulations by key stakeholders in intra-regional trade.

[The Guardian 09/03/15]

Guinea World Bank Allocates US$22 Million To Guinea / Mauritania Fisheries The World Bank (WB) has granted funding of US$22 million to Guinea and Mauritania. The move is part of the Programme régional des pêches en Afrique de l’Ouest [PRAO] which aims to strengthen the management, governance and the processing of fisheries in both countries. Efforts could lead to an annual profit of US$2 billion by promoting a sustainable fishing practice, incorporating the small players in the sector into new value chains and improving regional cooperation on common resources.

[Ecofin 18/03/15]

MaliMali Government Initiates Aquaculture ProjectThe Mali Government has launched a pilot aquaculture project valued at US$2.1 million to promote youth work in the sector through the use of floating cages. The project is run under the aegis of the Agency for the Promotion of the Employment of Youth [APEJ] which will provide equipment and grant loans to start activities.

[Ecofin 21/03/15]

15

COMMODITY NEWSFISH

Pan AfricaDiageo Sees Africa As 20% Of SalesDiageo Plc, the maker of Guinness beer and Johnnie Walker whisky, wants Africa to account for 20% [from 13%] of its sales after investing more than US$1 billion in the continent over the last 5-years. Diageo opened the Meta Abo brewery in Ethiopia in February investing some US$119 million since buying the brewery from Ethiopia’s government for US$225 million 3-years ago. The move will triple annual production capacity to 1.7 million hectolitres. Meanwhile sales of Guinness in Nigeria have rebounded after Diageo tried to premiumize its operation last year.

[Bloomberg 27/02/15]

Coca-Cola Beverages Africa The creation of Africa’s biggest Coca-Cola bottling company, which brewer SABMiller will have a majority stake in, could result in up to 387 head office job cuts but no lower-level retrenchments are planned. SABMiller said last year it would merge its African soft-drinks divisions with SA’s second-biggest Coca-Cola bottler and with the Coca-Cola Company’s local operations, to form Coca-Cola Beverages Africa. The new bottler would produce 40% of Coca-Cola’s beverage volumes in Africa and more than 80% of its volumes in SA. The merging businesses have a combined headcount in SA of about 7,500 people. So any possible redundancies as a direct result of the proposed merger will amount to about 5% of employees in SA.

[BD Live 20/03/15]

16

COMMODITY NEWSFOODSTUFFS & BEVERAGES

CameroonSodecoton To Produce 16,000 Tons Of SoybeanIn Cameroon, Sodecoton expects to produce 16,000 tonnes of soybeans in 2015 as part of its diversification strategy. Production was just 1,600 tonnes in 2012. Cameroon should soon receive a seed processing unit. Based in Douala, this infrastructure will be able to annually transform 18,000 tons of soybean offering an additional outlet for the production of the Sodecoton.

[Ecofin 23/03/15]

EthiopiaDutch Brewer’s Ethiopia Unit to Start SalesEthiopian greenfield brewer Habesha, majority-owned by Dutch brewer Bavaria NV, said it plans to start selling beer in Q2 2015. Bavaria NV is the latest beer maker lured by Ethiopia’s expanding middle class over the last five years and will compete with breweries owned by Heineken and Diageo.

[Tadias 03/03/15]

KenyaKeroche Breweries Eyes 20% Market Share Kenya’s Keroche Breweries [Summit Lager/Beer] is investing US$55 million to increase its capacity tenfold and help it grow its share of the alcohol market six-fold to 20% in about a year. The money will be used to build a new 1 million hectolitres-a-year brew house and bottling line to be launched this month that would help the company raise its market share from 3%. The increased production will also allow Keroche to start distributing its other products, which include spirits and table wines, in Uganda and Tanzania. Keroche is also considering putting up a malting plant in the future.

[Reuters 03/03/15]

MozambiqueMozambique Expands Banana Production Areas In Nampula Province

The Eráti district, in Nampula province, is to increase the volume of banana exports to Asian markets and find new markets for its product after announcing plans to provide the Jacarandá Agrícola agricultural company with over 6,000 ha in Mirrote [Namiroa] for the expansion of banana cultivation.

Jacaranda Agrícola, a joint venture [JV] established in Eráti district in 2010, grows bananas in a 50 ha area it considers to be insufficient for future expansion. The main market was United Arab Emirates which last year imported about 3,000 tons of bananas produced in the district.

Jacaranda Agrícola plans to repair, using its own funds and those of the Eráti government, the 35 km of road to Mirrote, improving the transport of its products. Nampula province has 2-major producers of bananas for export: Matanuska and Jacaranda Agrícola.

[Macauhub 23/03/15]

17

COMMODITY NEWSFOODSTUFFS & BEVERAGES

NigeriaPioneer Foods Enters Nigeria Market With US$7 Million InvestmentPioneer Foods, the maker of ProNutro and Weet-Bix breakfast cereal, has announced its first major foray into Nigeria. In what is deemed as a low-risk, route-to-market opportunity to expand its basket, Pioneer will pay US$7 million as it invests in a majority stake of newly formed company Food Concepts Pioneer [FCPL], with Lagos-based partner Food Concepts plc.

[Business Day 04/03/15]

Nestle Nigeria Slows Expenditure Nestle Nigeria expects capital expenditure to slow to its lowest level in 5-years after a currency devaluation triggered by a sharp drop in the price of oil dampened customer spending in Africa’s biggest economy. The Nigerian unit of the world’s biggest food group Nestle SA had invested US$400 million over the past 6-years into its food and cereal business to lift capacity. Nestle is to spend US$200 million over the next 18 months to maintain growth, such as investing in packaging which currently has to be imported, but would shift its focus to managing costs. Nestle Nigeria’s annual turnover hit N143.3 billion [US$716.50 million] in 2014, up from N133.06 billion in 2013. Pretax profit last year fell 6% to N24.44 billion.

[Africa Report 03/03/15]

SenegalEU Funds Onion Storage Facilities In SenegalThe European Union [EU] has announced the construction of 5-onion stocking and drying facilities in the Niayes area with a 500 ton capacity at a cost of US$900,000. They will be developed under the Program To Reinforce And Develop Commercial Capacities [PRDCC] and financed by the EU through the 9th and 10th European Development Funds. Onion production in Senegal is growing every year. Production rose from 40,000 tons in 2003 to 260,000 tons in 2013. However, stocking facilities are insufficient and effect market regulations and conservation of onions.

[Freshplaza 3/10/2015]

18

South AfricaCampaign To Raise Bottled Wine ExportsA new campaign has been launched aimed at increasing wine bottling in South Africa in the face of accelerating bulk exports. The ‘Creating Value at Origin’ initiative aims to raise the country’s reputation as a premium producer and comes in the wake of the recently negotiated Economic Partnership Agreement [EPA] that takes effect next year. From 2016, the country’s duty-free quota of wines exported to the EU will more than double from the present 48 million litres to 110 million litres.

However, just 84 million litres of what the industry presently produces would in principle be eligible for the duty-free exemption, because that is the annual amount of wine currently shipped to the EU in packaging of 2 litres or less and would, therefore, comply with existing EU regulations. To take full advantage of next year’s raised duty-free quota, the industry would need to increase its bottled output to the EU by another 26 million litres, and this is the goal of the campaign for next year.

The EU is South Africa’s biggest export market by far, accounting for 72% of exports in 2014. One of the benefits of the new EPA will be that producers will be able to bottle locally and export at less than the current costs of exporting in bulk and bottling in the EU. In 2014, 303 million litres of wine were exported to the EU, of which 62% was shipped in bulk. The balance was filled locally in bottles or in bag-in-box. This contrasts sharply with the pattern for most of the first decade of this century, when South Africa’s bulk exports to the EU hovered around 26% of the total.

[Drinks Report 04/03/15]

Progress In South Africa-US Meat DisputeSouth Africa, the US government and business negotiators have made progress in trying to solve a dispute about the entry of US meat products into the local market. This dispute is threatening South Africa’s continued participation in the African Growth and Opportunity Act [AGOA].

AGOA gives duty-free access to the lucrative US market for almost all South African exports and expires in September this year. The US Congress will decide soon whether and how to renew it and if South Africa should remain part of it. Some key congressmen have threatened to exclude South Africa if it continued to block the imports of US poultry, pork and beef on health and other grounds.

US exports of chicken to South Africa had been blocked entirely for 15 years, beef exports had been blocked for 12 years and pork exports for 2-years. The US exports pork to 100 countries, poultry to 170 countries and beef to 75 countries. At the same time, South Africa imports almost US$500 million worth of these same products from other countries a year while shutting out the US completely. This made it easy for US meat exporters to demonstrate to the US Congress that South Africa is discriminating against the US.

[Business Reporter 11/03/15]

19

COMMODITY NEWSFOODSTUFFS & BEVERAGES

Tanzania / UgandaScientists Set To Create Banana Hybrids To Raise YieldsA 5-year research project that aims to improve banana farming in Tanzania and Uganda by creating high-yield and disease resistant banana hybrids is set to begin trials in June this year. The project, which received US$13.8 million funding from the Bill and Melinda Gates Foundation in October last year, aims to develop banana varieties for smallholder farmers.

Uganda and Tanzania produce more than 50% of all bananas cultivated in Africa, but achieve only 9% of the crop’s potential yield because of pests and diseases, according to the Nigeria-headquartered International Institute of Tropical Agriculture [IITA].

The research project will include pest and disease control, and genetics. The venture hopes to boost resistance to common banana pests including banana weevil and nematodes; and diseases such as Black sigatoka also called black leaf streak and Fusarial wilt disease by up to 50%, while raising yields by 30%. Six east and central African countries - Burundi, Democratic Republic of Congo, Kenya, Rwanda, Tanzania, and Uganda - produce around 20.9 million tonnes of bananas a year with a value of US$4.3 billion, according to IITA estimates.

[SciDev 10/03/15]

ZambiaZambia To Sell Corn To Regional NeighboursZambia plans to sell as much as 33% of its record corn crop to regional countries including Zimbabwe as drought and floods in neighbouring nations decimate harvests. The country will sell as much as 1 million MT of its surplus set aside from its record 3.2 million-ton 2014 crop. Zambia’s government will export corn for prices ranging from $195-240 a ton. White corn in South Africa has surged 28% this year to $228 a ton.

After suffering the worst drought since 1992 in South Africa, the continent’s biggest corn producer and traditional supplier of its neighbours is predicting a 32% drop in the 2015 harvest. Meanwhile, Botswana said crops are showing signs of “total failure” due to below-average rainfall, while floods in Malawi and Mozambique have curbed production.

Grain SA, the largest representative of cereal crop farmers in South Africa, expects the country to have a surplus of at least 100,000 tons, enough to meet the needs of it and neighbouring Botswana, Lesotho, Namibia and Swaziland until the new harvest starts in about May 2016. Any extra demand by Zimbabwe would imperil the region’s supply balance. Zimbabwe has bought 56,997 tons from South Africa since the start of the marketing year in May last year, or 12% of the country’s exports. In the previous year, Zimbabwe purchased 28% of the total.

[Bloomberg 22/03/15]

20

Pan AfricaOlam: Africa Next Frontier For Palm Oil Production During the recent 3-day Palm Oil Conference [POC] in Kuala Lumpur, agri-business firm Olam noted Africa is a significant emerging market for growing and selling palm oil. Global production is currently dominated by Malaysia and Indonesia, accounting for 84% while Africa remains at 16%. Africa is an attractive market as it is where 60% of world’s arable land is located and it has a rapidly growing population in a favourable age range for work and product demand. Olam has recently entered into a Public-Private Partnership [PPP] with the government of Gabon to provide expertise in establishing palm oil plantations.

[ICIS 03/03/15]

21

COMMODITY NEWSPALM OIL

CameroonMoroccan Cosumar To Promote Batouri Sugar ProjectThe Moroccan sugar company Cosumar, has been retained by the Cameroon Government to develop the sugar Bertoua-Batouri complex project at a cost of FCFA60 billion. The project involves the construction of a production plant with a capacity of 60,000 tonnes per year, with plantations of sugarcane covering 32,000ha. Cameroon had signed a Memorandum of Understanding [MoU] in 2012 with Indo-Cameroon Justin Sugar Mills, but the contract was terminated in July 2014. A new call for investors was launched in November 2014 resulting in the appointment of Cosumar on February 25, 2015.

[Ecofin 27/02/15]

KenyaKenya Wins COMESA Extension For Sugar ImportsThe Common Market for Eastern and Southern African [COMESA] has extended Kenya’s sugar imports safeguard from the trading bloc until 2017.

Kenya is currently producing 70% of the total domestic sugar requirement, making it a net importer. Total sugar requirement in the country is approximately 800,000 MT, consisting of 650,000 MT of table sugar and 150,000 MT for industrial use. The gap in local production is supplemented through imported sugar mainly from COMESA and the East Africa Community [EAC] markets and refined sugar from non-COMESA/EAC markets. Kenya, as a member of the EAC Customs Union, is under an obligation to allow quota and duty free access of sugar and other commodities from partner states taking into account domestic needs. Kenya imports from some of the major sugar producers in the 19 member bloc including Malawi, Zambia and Mauritius, but the COMESA treaty allows for member states to apply for import restrictions in order to protect their local industries and bloc’s safeguards allow Kenya to maintain a 350,000 MT ceiling on duty-free sugar imports from within the bloc. Kenya’s sugar safeguard has been in place for 12 years.

Kenya’s sugar sector is ailing, with millers faced with issues of cane supply shortage due to varieties that take long to mature and are rain-fed, rampant cane poaching and general mismanagement. According to Ecobank’s latest report Kenya is likely to face difficulties in implanting reforms in the sugar industry because of the interlocking stakeholder and political interests in the sector.

[CNB Africa 05/03/15]

Kenya Allows More Sugar From UgandaThe government has allowed Uganda sugar manufacturers to export up to 97,000 tonnes of sugar to Kenya, which ends a stand-off between the 2-governments which has marred trade relationships. Though Uganda has capacity to export more than 150,000 tonnes into the Kenyan market after overcoming the 2011 sugar deficit, in 2012 Kenya blocked imports citing dubious trade activities and dumping; it required discussions at a presidential level to reach a compromise on the issue of surplus sugar into the region’s biggest economy. Uganda’s annual sugar consumption stands at 320,000 tonnes against the over 465,000 tonnes produced, but sugar production is projected to reach 623,700 tonnes this year.

[East African Business Week 15/03/15]

Kenya To Sack Over 300 Workers To Save Sinking Sugar CompanyKenya’s largest sugar manufacturer, Mumias is set to be offered a lifeline by the government which has proposed a U$55 million deal to revive the company. The revival will be funded by shareholders and the government and will involve the sacking of the board and management of the company, as well as the retrenchment of about 300 staff.

Mumias Sugar have struggled to be competitive due to the influx of cheap imports into the market and corruption in the company. A draft audit report by KPMG blamed management teams under former Managing Director Dr Evans Kidero and his successor, Peter Kebati for the company’s woes. Last year the company’s losses hit Sh2.7 billion and its share price fell to a new low of Sh1.45. It just reported a first-half loss of Sh2.08 billion from a restated loss of Sh407.4 million a year earlier. The company blamed its woes on lower prices due to illegal sugar imports as well as a prolonged shutdown due to unscheduled maintenance from October to December last year. Low production and high production costs also affected performance. However, having resumed production, the company believes it will have a better second half.

[Ventures Africa 08/03/15]

22

COMMODITY NEWSSUGAR

TanzaniaTreasury, Sugar Producers In Cautious Import DriveTanzania’s treasury is working with local sugar producers to establish the extent of the sugar shortage before it allows importation despite a previous declaration made by the government that there would be no importation of sugar in the 2014-2015 fiscal year. The demand for sugar in Tanzania stands at rough 420,000 and 170,000 tonnes per annum for domestic and industrial sugar, respectively, for a total of 590,000 tonnes each year. However, local industries can only produce 300,000 tonnes and thus each year there is a shortage of 290,000 tonnes.

[Daily News 09/03/15]

23

COMMODITY NEWSSUGAR

BurundiRevenues Rise 2.4% In 2014Burundi’s tea export revenues rose 2.4% in 2014 from a year before due to favourable weather that helped increase the harvest. Tea is Burundi’s second-largest hard currency earner after coffee. Export earnings rose to US$21.3 million from US$20.8 million in 2013, while sales jumped to 9,836,296 kg up from 8,696,223 kg, state-run tea board [OTB] said in its report. But OTB said the average export price per kg for Burundi’s tea declined to US$2.17 from US$2.38 the previous year, blaming the fall to a weaker regional market following higher supply of the commodity from neighbouring Kenya, is the top regional producer. Burundi exports 80% of its tea through sales at a weekly auction held in the Kenyan port city of Mombasa.

[Reuters 25/02/15]

KenyaPrices Drop As Production IncreasesTea production is on the rise, a factor that might lead to lower prices at the auction. According to the Kenya Tea Development Authority [KTDA], tea production was up 8.7% in the 6-month period between July and December 2014. In the 6-months, small holder green leaf production stood at 569.7 million kg compared to 524 million a year earlier. In H1 tea factories processed some 128.07 million kg of made tea up from 118.1 million kg processed in the same period last year. The agency is hoping a dry spell between January and end of March will lower production leading to better prices for tea. A kilo of processed tea during the last 6-months traded at an average price of US$2.23 down from US$2.42 during the same period in 2013, a decline of 8%. Overproduction of tea has been attributed to the sectors woes over the last 2-years.

[KTN 02/03/15]

Kenya Tea Factories Scale Down Operations As Drought Cuts YieldsThe Kenya Tea Development Agency [KTDA] has said that tea factories are cutting back operations because a drought is causing a decline in output. Prices for the crop have risen 24% so far this year to a high of US$2.50/kg at auction as the amount of tea on offer has dropped 7.8%. The drought has resulted in factories receiving tea only three or four days a week, instead of daily. Tea is the biggest generator of foreign-currency for Kenya, earning US$1.03 billion last year. KTDA is the nation’s top grower of the leaves, representing more than 500,000 small-scale producers, some of whom have faced a “drastic reduction” in volumes. Prices have dropped because of the decline in output.

[Bloomberg 10/03/15]

24

COMMODITY NEWSTEA

GeneralProducers Bracing For Tough Price NegotiationsWhile it is too soon after the Lunar New Year holidays in China to assess how markets will develop during Q2, it seems certain that buyers will want to take advantage of the weakening price trends for some premium species observed towards the end of February. Producers are bracing for lower price offers for new contracts. By late February some producers reported that buyers, particularly those buying for the Chinese market, were already indicating their intentions to push prices lower. With generally high stock levels in China buyers appear prepared to wait before placing new contracts.

[ITTO 16-1/02/15]

Chinese Market Important For Log ExportersWest and Central African producers now depend on the market in China where, recently, there have been mixed signals on the strength of the construction and housing sectors. The Chinese market is important for log exporters but they have pointed out that the limits on harvests are becoming steadily tighter which is aggravating an already tight supply situation.

[ITTO 16-1/02/15]

Okoume Sawnwood Stocks Building UpMiddle East markets for sawnwood are firm. Lower priced grades attract most buyers in this market so buyers are quick to respond to any signs of price weakness. Currently, some producers report poor demand for okoume sawnwood in China and the Middle East which has resulted in a build-up of log and sawnwood stocks. In an effort to move stocks some producers are said to be lowering prices. However, the current price weakness is limited currently to the few most heavily traded species, such as sipo and sapele which have seen prices climb over the past few months. Prices for most others are stable having hardly moved over the past 12 months. There is a general feeling amongst producers in the region that prices peaked at end 2014 and until demand picks up again in Q2 it will be difficult to secure firmer market prices for premium species.

[ITTO 16-1/02/15]

International Hardwood ConferenceThe ETTF will jointly host the 2015 International Hardwood Conference in Copenhagen on September 17 2015 with the European Sawmillers Organisation [EOS]. Consequently it will broaden to encompass non-European species, including tropical, as well as European hardwoods.

CameroonHigher Canadian Sapelli Imports From CameroonCanadian tropical sawn hardwood imports in 2014 increased by 6% from the previous year to US$25.8 million. The value of Canadian imports was 9% of total US imports of tropical sawnwood. Sapelli imports increased by 53% to US$5.8 million in 2014. Combined imports of virola, imbuia and balsa grew by 40%. 2014 mahogany imports were unchanged from 2013. Canadian imports from Brazil fell by 33% in 2014. Cameroon narrowly surpassed Brazil’s to become Canada’s largest source of tropical sawnwood in 2014.

[ITTO 16-1/02/15]

25

COMMODITY NEWSTIMBER

GhanaSurge In Air Dry Sawnwood Exports As Power Outages Limit KilningAir dried sawnwood exports increased 35% between January and November 2014 compared to the same period in 2103. The increase in exports of air dry rather than kiln dry sawnwood can be attributed to the unavailability of power for manufacturers to operate kilns. Ghana is currently experiencing extreme power shortages and scheduled load-shedding began last year. The ongoing power crisis is affecting the manufacturing sector where some companies have lowered production rates. According to the Timber Industry Development Division [TIDD] of the Forestry Commission [FC], Ghana’s January to November 2014 timber export of 313,799 cu.m of wood products earned €122.40 million. Some 21 different products were exported.

Ghana’s sliced veneer exports to neighbouring countries between January and November 2014 totalled 85 cu.m. The main markets were for veneers in Egypt, Italy, China, Spain and Germany. The major species used for the production of veneer were asanfina, ceiba and mahogany. Plywood exports to neighbouring countries continue with buyers in Nigeria accounting for over 60% of total regional plywood sales. Nigeria is a major market in the ECOWAS block and Ghana plans to double exports.

[ITTO 16-1/02/15]

Jan-Nov 2013 Vol [m3] Jan- Nov 2014 Vol [m3] % change

Sawnwood[ AD] 84,325 114,243 35

Sawnwood [KD] 58,158 54,571 -6

Plywood 54,870 55,606 1

Poles 36 26,463

Billets 7,249 21,720 200

Sliced veneer 20,562 21,238 3

Others 20,453 19,958 -2

Total 245,653 313,799 28

New Bamboo Craft VillageGhana now has a new centre in the nation’s capital for bamboo, cane and rattan artisans known as the Bamboo, Cane and Rattan Village to serve as a permanent home for artisans. The facility was recently handed over by the Millennium Development Authority [MiDa], to the Ministry of Lands and Natural Resources. The government is committed to promoting the trade and development of these products.

[ITTO 16-1/02/15]

Organisation Calls For Review Of Ghana Rosewood BanThe Bureau for Internal Affairs [BIA] has asked the Ministry of Lands and Natural Resources to review the ban on the harvesting of rosewood. The BIA said that although the Forestry Commission granted permits to some companies to salvage logs, the Ministry of Lands and Natural Resources had previously emphasised that the ban on harvesting, transportation, processing, export or sale of rosewood in any way was still in force. BIA said the premature ban had caused a number of companies to go bankrupt, which it viewed as not only unfair to indigenous businesses, but had led to financial loss to the state.

[GNA 09/03/15]

26

ZambiaZAFFICO Cuts Log Volumes Zambia Forest and Forestry Industry Corporation [ZAFFICO] has drastically reduced and standardised the monthly volumes of logs saw millers are supposed to get due to increased number of dealers in the industry; each saw miller is now to get 35 cu.m of logs per month across the board.

This has worried the Zambia National Association for Saw Millers [ZNAS] noting the move will negatively impact on its members operations. ZNAS said that ZAFFICO reduced the number of volumes for pine from 85 and 55 to 35 cu.m across the board and that no members were allowed to buy less or more than the stipulated 35 cu.m of pine logs per month, while the allocation for the logs was done on quarterly basis bringing the total volume of the product to 105 cu.m. ZAFFICO has embarked on this move to cater for the increased demand for logs as a result of more saw millers having come on board; the number of saw millers has increased from the previous 548 to 1,300.

[Times of Zambia 19/03/15]

27

COMMODITY NEWSTIMBER

KenyaHigher Export Earnings Boost BAT’s Net ProfitBAT Kenya posted a net profit of Sh4.25 billion in 2014 boosted by higher export revenue and growth in sales locally. The company’s closure of the Democratic Republic of Congo [DRC] plant and relocating production to Kenya, led to a 26% growth in export volumes. Gross revenue increased by 7% for the period ending December 31, 2014 to Sh34.12 billion compared to Sh31.9 billion in 2013. BAT reported a growth in sales volumes of all its cigarette brands except for the Safari brand which is targeted at the low income smokers. BAT recorded a 43% rise in sales volume of its premium Dunhill brand.

[Star 28/02/15]

ZimbabweTobacco Farmers Rake In U.S $1.2 MillionFarmers have earned US$1.2 million from the sale of flue-cured tobacco since the opening of the selling season. Statistics from the Tobacco Industry and Marketing Board [TIMB] have shown a decline in the volumes of tobacco sold this season compared to the same period last year, down 17% from 940,864 to 775,997kg. Of the volumes of tobacco sold so far 10,298kg worth US$16,275 were sold through contract floors. The decline in the volumes has been attributed to a late season and extreme weather conditions that resulted in floods and dry spells that affected the crop. Most farmers are still reaping and curing their crop due to late planting. The prices being offered this season are also low compared to the corresponding period last season. So far the average price is US$1.53/kg compared to US$2.42 last season. Farmers have registered discontent over the low prices which they say are not viable.

Statistics show that the prices at the contract floors have also declined, with the average at US$1.58, which is close to that offered at the auction floors. Buyers have offered a highest price of US$4.95 since the opening of the selling season and a lowest price of US$0.10 per kg. The tobacco industry expects about 180 million kg of tobacco this season, down from a target of 222 million kg as the crop was affected by floods in some areas.

[The Herald 10/03/15]

Irregular Tobacco Season Forces TSL to InnovateDiversified agro-concern TSL Limited says the late start to the tobacco selling season will impact negatively on its tobacco operations leading to a flat performance on the prior year. To mitigate this, the company says it has introduced hand stripping and re-handling of tobacco at the auction floors to improve revenues. The move to introduce re-handling is in line with a directive by the Tobacco Industry and Marketing Board [TIMB] that auction floors re-handle all rejected defective bales as a way of protecting growers from buyers who later sell the bales at a higher price. National tobacco output is expected to be below targets due to the heavy rains that delayed the harvest and subsequent marketing season. Global oversupply of tobacco in China and Brazil is also a major issue that will impact prices this season.

[The Herald 12/03/15]

Virginia Tobacco Exports Rake In Over U.S$200 MillionVirginia tobacco exports have so far earned the country US$211.9 million, with China remaining the leading exporter after buying 19.3 million kg worth US$166.7 million at US$8.63 per kilogram. The US$211.9 million was realised from the sale of 31.2 million kg at US$6.75 per kg. This was an improvement from the US$40.8 million that was realised from the sale of 11.4 million kg at US$3.58 per kg during the same period last year.

Zimbabwe is exporting its golden leaf to at least 33 countries dotted across almost every continent. Latest figures from the Tobacco Industry and Marketing Board [TIMB] show that South Africa is the second highest importer after buying 3.5 million kg for US$13.5 million at US$3.77 followed by Mauritius which accounted for 1.3 million kg worth US$5.4 million at US$4 per kg. Other top importers include Russia which paid US$3 million for 1.2 million kg at US$2.53 per kg and the United Arab Emirates that spent US$2.5 million on 650,034 kg at US$3.97 per kg.

[The Herald 17/03/15]

28

COMMODITY NEWSTOBACCO